The shares of the British waste management company, Shanks fell more than 15 per cent after the group announced that it ended talks with a private equity investor, Carlyle for a possible sale of business.

The board of Shanks had valued the firm at 150 pence per share however Carlyle indicated that it can offer only 120 pence per share under a revised offer by way of cash payments for the group. The offer is even lower than the
135 pence per share that it was believed to be considering last year.

The shares of the company closed at 120.4 pence on Monday and they dropped 15.7 per cent to close at 101.5 pence on Tuesday. Despite the 15% fall of Tuesday the shares have recorded a growth of 140 per cent over the last one year.

"Although the timing of their approach was not of our choosing, we have engaged fully and professionally, but Carlyle has failed to offer a price which properly reflects the value of the group," said Chairman of the firm, Adrian Auer.

The board was supported by its two largest investors, Schroders Investment Management and Legal & General Investment Management, in determining the price of 150 pence per-share for the firm.

Carlyle has not yet responded to the announcement but it is believed that it will not adopt a hostile route to take over the company. Carlyle did not comment on why it decided to reduce the offer price to the level of 120 pence per share

The profit of the company for the year is expected to be lower than last year because the cold weather this winter had restricted it work.

Analysts have expressed shock over the break down of talks and also on the lower offer price set by Carlyle. Analyst Charles Pick at FinnCap does not believe that the lower profit expectation could cause in such a lower offer price because it is mainly due to one time weather issue.